Minimizing Inappropriate Levies in IRS'sFederal Payment Levy Program.

Each year, thousands of taxpayers who owe delinquent federal taxes receive billions
of dollars in federal payments. To help the Internal Revenue Service (IRS) collect
these delinquent taxes more effectively, the Congress passed the Taxpayer Relief Act
of 1997, the provisions of which authorized the establishment of the Federal Payment
Levy Program (FPLP), which allows IRS to continuously levy up to 15 percent of the
payments made to delinquent taxpayers. The Department of the Treasury’s Financial
Management Service (FMS), which receives payment records from and makes
payments on behalf of most federal agencies, collects the continuous levy from the
federal payment after IRS has authorized the levy. Subsequent payments are
continuously levied until such time that the tax debt is paid or IRS releases the levy.